Property owners in the residential rental market have faced tough conditions over the past three years due to the COVID-19 pandemic and the resultant economic downturn. Encouragingly, the most recent PayProp Rental Index reports a return to rental growth to pre-pandemic levels.
Michelle Dickens, CEO at PayProp, says the appointment of a qualified property professional is critical to help buy-to-let investors navigate the changing rental market. “A professional property practitioner is able to give an owner peace of mind when it comes to understanding market trends, adequately dealing with tenants and making sure that every Rand is accounted for.”
She offers a few guidelines before deciding on a property partner:
- Adequate accreditation
A property professional is required to be registered with the Property Practitioners Regulatory Authority (PPRA) and have a valid Fidelity Fund Certificate (FFC). If you are in doubt, contact the PPRA and enquire about the regulatory status of the agency you intend to do business with.
- Professional systems
Financial management is one of the most important parts of rental property management. If your chosen property professional is using a combination of Post-it notes and spreadsheets to manage your property finances, you will be in for a frustrating time. Make sure that your partner uses an advanced FinTech platform like PayProp, which plugs directly into the SA banking system, offering state-of-the-art trust account management and peace of mind that your funds are managed professionally, safely and with maximum transparency.
- Insist on a mandate
It is tempting to ‘keep things casual’ and just brief the agency over the phone, encouraging them to just ‘get on with it’, but not agreeing to a detailed mandate of management activities is a massive risk for any owner. Ensure you have a document outlining exactly what the agency can and cannot do and what you must pay in return.
- Non-negotiable ingoing inspections
Once appointed, remember to ask to see copies of the ingoing inspection report. If this report has not been done, you are not able to claim for any damage from the tenant when they leave, as no baseline for the condition of the property exists. Ensure that this report is done prior to the tenant gaining access to the property.
- Dotting the i’s and crossing the t’s
While the tenant has the right to decide that you, as a third party, may not see his credit check results, you may ask the agency if a check has been done and if their analysis thereof has provided them with comfort that this is indeed a good tenant. Before appointing an agency, check what their policy is regarding credit checks and do not sign a lease until this check has been undertaken.
In conclusion, Dickens says property letting is a highly specialised and skilled field that requires the guidance and assistance of an accredited property professional.
“Property professionals keep investors abreast of trends in the private rented sector, which is continually influenced by political and economic factors. Added to this, you should be working with an agency with the systems and resources in place to manage your property professionally.”
Writer: Daniela Els
